A
February 1998 Liberty poll found that 43% of respondents agreed with
the proposition: "abortion is wrong." Thus, we might
conclude that pro-life sentiment exists within a substantial minority
of classical liberals. Being one scholar within that minority, I
would like to offer an explanation for this seemingly anomalous
tendency, showing why it is consistent with classically liberal
principles. Then I propose to embellish the notion by an economic
analysis that might well be agreeable to people on both sides of the
abortion issue. Indeed, I argue that the lion's share of abortions
are the result of distortions caused by government failures, myopic
intervention, and policies that facilitate deleterious rent seeking.

I.
Classical Liberalism vs. Proactive Public Policy

Classical
liberalism exalts individual human rights. The idea espoused by
abortion choicers (at least most scholarly ones that I know) is that
human beings must first be endowed with a sacred grail called
"personhood" before gaining full protection under the law.
This status is granted upon being favorably inspected and approved by
some social consensus or public policy. Only after receiving this
blessing does the human being become a "rights-bearing"
individual.

However,
from the pro-life perspective, this idea of having two classes of
human beings runs contrary to consistently classically liberal
thought, where the presumption is that living human beings are all
persons and thus are rights bearers on account of their membership in
the species. As Peter Kreeft has astutely shown, human beings are a
sub-class of persons, not the other way around. Following historical
precedent, we have always included other living entities besides
humans among persons, e.g., God, extraterrestrials, angels, etc.

Furthermore,
our rights are not confirmed by public policy; they are antecedent to
it. This perspective is the only one which can be said to be
classically liberal. (Not suprisingly, 89% of respondents in the Liberty
poll agreed with the statement: "All men by their nature have a right to
life" and to "liberty" and 83% agreed that "All men by their nature have a
right to property".) If any public policy is legitimate it must be
reactive rather than proactive, and certainly not entail granting the
state or some coercive (or otherwise authoritative) communitarian
pact to decide which of our species has rights and when.
Alternatively, denying rights to certain classes of human beings on
philosophical grounds has been a hallmark of leftists and criminals
(if there is a difference between the two) for centuries. Their idea
is simple: a few of us reason and decide that some class of human
beings should be excluded from being rights-bearers and enforce our
thesis via proactive public policy. The criteria used might be
genetic, ethnic, superficial (e.g., skin color or size), or some
arbitrarily picked point of development.

Consistent
with the classically liberal framework, I start with the simple
assertion that (1) all living human beings have rights, (2) that
their rights are antecedent to the state or "natural", and
that (3) they are shared equally by all living, innocent human beings
without any discrimination favoring one over another for any reason.
For me, this is the purest classically liberal view. Alternatively,
the predominant view among Libertarian academics suggests that the
state or some social apparatus must first decide which human beings are
qualified as "persons" and then grant them rights. Hence,
rights are not natural but derived from the community or political
process. After the linguistic and legal ruse that artificially
divides humanity and personhood is accomplished, steps 1, 2 and 3
supra can be repeated by replacing the term "human beings"
with the word "persons" and we have a policy-relevant
rights theory. We also end up with a rationale for killing. Indeed,
we can kill the non persons and demand protection for the rest who
have qualified. For many, it is a means of having their cake and
eating it too. However, I would like to emphasize that it is no minor
offense to classical liberalism that public policy or some
authoritative social apparatus has been injected into the
rights-granting process (perhaps unwittingly) as the superior or
grantor of rights. But such intervention is only the beginning of
sorrows.

II.
Market Failure Theory Analysis

Unwanted
pregnancies, in an economic sense, involve either crimes or negative
externalities. That is, they result from rape on the one hand or, on
the other hand, they are the unintended "bad" consequence
of mutually beneficial exchanges. (Note that wanted pregnancies could
well be a positive externality, depending on preferences and the
circumstances.) Since something like 99.9% of all unwanted
pregnancies fall into the negative externalities category, it is most
useful to focus any policy discussion on them.

As
with all negative externalities, there are three (or more) parties
involved: two people who exchange and have mutually beneficial gains
from trade, and one person who incurs costs as a by-product of the
production of the others-but who shares in none of the benefits from
their transaction. When property rights are clearly defined, the
parties who exchange must compensate those who would be damaged by
their production that are not parties to the transaction. The parties
exchanging often buy insurance that will compensate for any
unintended damages. Thus, in one way or another, the social costs are
internalized. However, when property rights are not well defined,
i.e., when it is costless to pollute or to damage third parties
(unintentionally), these social costs will not be internalized and
third parties will lose. Such a scenario is deemed a "market
failure" in the extant economics literature.

There
are a couple ways to deal with or "solve" market failures.
One way has been outlined by Coase, et al. When transactions costs
are very low (i.e., lower than litigation costs), and there is free
bargaining, third parties will arrive at an agreement with those
producing the damage without any government intervention, i.e., they
will receive some compensation. However, when transactions costs are
high, Coase's argument implies that government-made or judge-made
policy may be able to alleviate the problem better than the market
can. In sum, proactive public policy is thought to be able to improve
on what the market produces or to alleviate the market's failure.

Abortion
involves a market failure. The adversely affected third party is the
unborn child(ren). The transactions costs are very high for him to
bargain because he cannot talk yet or write or bargain in any way.
Yet this fact does not necessarily empower public policy to provide
more optimal results than Coasean bargaining. The unborn child is a
minor and, therefore, just a 5 year old minor who is damaged by soot
from a factory, someone else from the human species may vouch for him
as guardian and vicar. Plus, it is well established practice in law
that this benefactor need not be his natural parents. Indeed,
classical liberalism would have no qualms with anyone entering on a
child's behalf in order to save or protect him. Logistically,
guardianship may be purely contractual, where one auctions off the
flow of utility for years of having a kid to the highest bidder. So
then, the transactions costs are shifted to the guardian who becomes
the unborn child's vicar, and his transactions costs of negotiating a
settlement are far lower than the unborn child's would be. This
outcome is not surprising. Markets automatically tend toward such
cost-minimizing solutions.

Thus,
there is little reason to doubt that some agreement would be reached
in the market to deal with unwanted pregnancies without resorting to
public policy-especially given the evidence of a extensive network of
people who dedicate their time to helping the unborn and the present
high demand for adoption services. Adoption services compete with
abortion services. They are two distinct solutions to the "market
failure". Abortion markets are largely artificial and
inefficient, not to mention morally vile. On the other hand, there
are many Coasean solutions to be found in the adoption market.
Conformably, both Chicago and Virginia public choice theory would
suggest that any intervention which precludes Coasean solutions would
tend to make the abortion situation worse in terms of social
efficiency.

On
the one hand, markets will never resolve the unwanted pregnancy
problem perfectly but, over time, they would tend to provide the most
efficient and effective allocation of productive resources, and
create institutions and incentives that best maximize those goals and
thus minimize abortions. In the market, ultimately, the number of
abortions in society will depend on social pressures and individual
preferences. Hence, absent the manipulation of information and
encouragement of abortion solutions by government, it seems
reasonable to conclude that preferences would not so strongly favor
abortion. This makes some sense given that, at present, a mother's
cost in terms of being responsible for her procreative actions is
lower than it otherwise would be, since there is an socially accepted
way "out" for her. In short, proactive public policy has
artificially reduced her costs.

On
the other hand, government intervention to fix the alleged market
failure tends to exacerbate the problem of unwanted pregnancies. Such
proactive policies only tend to benefit rent seekers, viz., those who
benefit from creating artificial scarcity. In the case of abortion,
artificial scarcity is created for abortion services, fetal tissue
harvests, etc. Surely, like legally mandated air bags and smoke
detectors, there will always be a demand for abortion products, but
rulings and legislation favoring abortion changes catallactic
institutions and incentives. These changes permit special interest
groups to capitalize on new opportunities by channeling more
ill-directed funds to their faction. In short, people will demand far
more abortion services than they would normally demand in the market
on account of the policy designed to fix the market failure.
Moreover, market-based institutions will also suffer. For instance,
adoption is a market-based solution to the negative externality
problem. It is no wonder that governments, which tend to coddle rent
seekers, do their best to hinder this institution. They also make it
difficult for babies to be positively priced in the market, which
leads to other distortions.

As a
result, abortion policy yields social inefficiency and negative sum
games. Abortion, the killing of innocent human beings, is not
minimized. In fact, it is maximized/optimized and rent seekers
benefit from it. Society loses because of (1) the reduction of human
minds available, (2) the shift in labor from productive activities
into rent seeking and humanity-destroying activities, (3) the
monopoly prices consumers face via restrictions on certain output
pertaining to the abortion industry or in "buying" a child
via adoption, (4) the diversion of scarce resources from their normal
productive uses into abortion prevention or promotion; just as
devoting time and money to prevent burglary is a "waste" or
non-productive, so preventing the killing of innocent human beings is
a costly activity that channels resources from productive activity,
and (5) the costs of "paperwork contests" that are
generated as many rent seekers spend resources to obtain or retain
the same booty which only one can win. Policymakers never had a
chance to achieve their public benefit goals anyway, even if they
really were publicly spirited, on account of the "knowledge
problem" that they face (per Mises and Hayek). They cannot
possibly garner sufficient social knowledge to improve on the market
or correct its "failure".

The
market indeed failed (at least in terms of producing zero unwanted
pregnancies). That is bad or less than paradise. However, public
policy creates a government failure which ends up being worse. We
trade purgatory for hell. Furthermore, the rent seeking game worsens
as regressive (rent seeking) entrepreneurs begin to "alertly"
find arbitrage niches, like growing and harvesting fetal tissues.
This again changes institutions and incentives and exacerbates the
negative externality problem. Even if the number of abortions does
not continue to rise perpetually, a distorted market equilibrium will
be found which tends to make the number of abortions and unwanted
pregnancies remain at a new, artificially high rate. On account of
the institutional arrangements and ease of getting an abortion,
mothers will have fewer incentives to avoid unwanted pregnancies.
Then as institutions also develop to benefit the mother in a
pecuniary manner, e.g., she might be paid for selling off pieces of
her unborn child, abortion would become more permanent and
attractive, and could tend to occur at later stages of gestation. The
bottom line: many politicians are happy, rent seekers are happy,
certain moral philosophers and feminists are elated; but most
individuals in society suffer on account of this artificially
extensive market.

III.
Counting the Social Cost

The
greatest sufferers are, of course, those 40 million plus innocent
unborn children who have been killed in the USA alone and the
proximate millions that will be killed in ensuing years. Society
loses minds and the ideas they would have, as well as the resources
that are siphoned off in order to kill them, etc. But the murdered
lose the opportunity to live and to enjoy life and all that living
entails. Too, they have to bear the pain of being burned to death by
saline solution or chopped up into pieces by sharp instruments, and
would hardly be consoled by the fact that their remains will go to
benefit medical science or rent seekers.

In
short, economic analysis suggests that abortion policy is not in the
public interest-and no public policy can be justified which is not in
the public interest. We already knew that from Julian Simon's thesis
alone, which says that more minds bring some short term costs but far
greater long term gains. The mind is the ultimate resource and the
only thing which is truly scarce in absolute terms. Abortion thus
adversely affects society by both reducing the quantity of minds
available and by exacerbating negative externalities. Accordingly, I
conclude that abortion is not in the public interest on account of
both of these reasons and, therefore, it can not be a just or
genuinely beneficial public policy. Abortion policy leads to negative
sums game which, like other forms of murder or theft, only benefit
some at the expense of others.

In
conclusion, abortion policy is an evil both morally and
theoretically. It also stems from a philosophy of rights which is
antagonistic to classically liberal principles. Nevertheless, I
imagine that many of my adversaries among hard-core leftists or
left-leaning Libertarians will reject my pro-life stance in general.
But I hope that they will at least agree with me that state
intervention supporting or promoting artificially high rates of
abortion is simply deleterious.